Archive for April, 2008

Unlocking the value of better data

Tuesday, April 1st, 2008

In a previous post I made reference to the lack of technology available to publishers to increase the value of their premium inventory, which in many cases makes up 80+% of their total revenue, even though it is often a much smaller percentage of their total impressions.  One of the main ways to make it more valuable to brand advertisers is to give them a more targeted audience, and charge higher CPMs because of the increased efficiency to the advertiser.  Many publishers are reluctant to do this, however, for two reasons: either the don’t have the data, or their afraid that targeting will fragment their inventory.  They know that without good inventory tools, inventory fragementation could result in lower overall revenue.

There are a number of ways to collect and target on better data: behavioral targeting, user registration, and data exchanges are just a few examples. And, there are a number of companies like Tacoda or NextAction that can help provide data that advertisers will pay more for.

The second reason above, fragmentation, hasn’t gotten as much attention.  Brand advertisers want a targeted audience with broad reach, so publishers end up building broad products that take inventory from many different parts of their site.  While it’s clear that selling Moms for $20 CPM is better than selling my Entertainment section (which overlaps by 50%) for $15, if I’m also stealing inventory from my $25 CPM Travel section, that’s not a good thing.  This kind of data can be highly complex, and quickly outstrips an ad operations team’s spreadsheet skills.  The industry is just beginning to deliver the tools that publishers need to really take advantage of better data to generate more revenue, and Yieldex is at the forefront.

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